Correlation Between Ivanhoe Energy and Bluestone Resources
Can any of the company-specific risk be diversified away by investing in both Ivanhoe Energy and Bluestone Resources at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Ivanhoe Energy and Bluestone Resources into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Ivanhoe Energy and Bluestone Resources, you can compare the effects of market volatilities on Ivanhoe Energy and Bluestone Resources and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Ivanhoe Energy with a short position of Bluestone Resources. Check out your portfolio center. Please also check ongoing floating volatility patterns of Ivanhoe Energy and Bluestone Resources.
Diversification Opportunities for Ivanhoe Energy and Bluestone Resources
0.31 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Ivanhoe and Bluestone is 0.31. Overlapping area represents the amount of risk that can be diversified away by holding Ivanhoe Energy and Bluestone Resources in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bluestone Resources and Ivanhoe Energy is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Ivanhoe Energy are associated (or correlated) with Bluestone Resources. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bluestone Resources has no effect on the direction of Ivanhoe Energy i.e., Ivanhoe Energy and Bluestone Resources go up and down completely randomly.
Pair Corralation between Ivanhoe Energy and Bluestone Resources
Assuming the 90 days horizon Ivanhoe Energy is expected to generate 0.65 times more return on investment than Bluestone Resources. However, Ivanhoe Energy is 1.53 times less risky than Bluestone Resources. It trades about -0.01 of its potential returns per unit of risk. Bluestone Resources is currently generating about -0.01 per unit of risk. If you would invest 1,546 in Ivanhoe Energy on August 29, 2024 and sell it today you would lose (264.00) from holding Ivanhoe Energy or give up 17.08% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Ivanhoe Energy vs. Bluestone Resources
Performance |
| Timeline |
| Ivanhoe Energy |
| Bluestone Resources |
Ivanhoe Energy and Bluestone Resources Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Ivanhoe Energy and Bluestone Resources
The main advantage of trading using opposite Ivanhoe Energy and Bluestone Resources positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Ivanhoe Energy position performs unexpectedly, Bluestone Resources can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Bluestone Resources will offset losses from the drop in Bluestone Resources' long position.| Ivanhoe Energy vs. Questerre Energy | Ivanhoe Energy vs. Ivanhoe Mines | Ivanhoe Energy vs. Eastern Platinum Limited |
| Bluestone Resources vs. First Majestic Silver | Bluestone Resources vs. Ivanhoe Energy | Bluestone Resources vs. Orezone Gold Corp | Bluestone Resources vs. Faraday Copper Corp |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Global Correlations module to find global opportunities by holding instruments from different markets.
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